What retirees want from their adviser

retirement savings financial planning financial adviser

20 January 2023
| By Rhea Nath |
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Australians approaching retirement are increasingly interested in using an adviser’s services, but it goes beyond financial advice, according to research.

Fidelity International’s latest New Life Old Life report, which surveyed over 1,200 Australians over the age of 45, found advisers remained the preferred professional to help them plan for their next phase of life over accountants or employers.

Four in five pre-retirees currently received advice, had received advice in the past, or would consider receiving financial advice. Of those who had never received financial advice, three in five were open to it. 

Notably, many believed advisers could play a role in building their emotional resilience to withstand major life changes in retirement. Nearly 60% of pre-retirees saw this as a key part of their adviser’s responsibilities while 78% thought an adviser could support them to make decisions that enhanced their quality of life in retirement. 

“Major life changes such as retirement are challenging. Our research shows that pre-retirees approach retirement cautiously, wary of the number of uncertainties around this unknown period of life,” said Richard Dinham, head of client solutions and retirement at Fidelity.

Advised retirees said they lived more consistently within their values, had a greater sense of meaning and purpose and were more financially resilient, the report stated. 

“With so much evidence of the intangible benefits of advice, there is a strong argument that financial advisers should embrace the drivers of quality of life and intentionally enhance the client’s sense of purpose, financial capability, resilience, sense of control, day-to-day emotional experience and social interaction,” added Dinham.

For advised semi-retirees, who were over 50 years of age and transitioning from full-time work or working part-time or casual, advice on structuring their finances was top of mind. This was followed by advice on their superannuation, coping with the emotions of retirement, and choosing the right opportunities.

“It’s clear that a key driver of a positive emotional experience at retirement is a sense of control in the decision. And while financial matters are not the only factor to take into account, there is no doubt that they have an important role to play in ensuring a feeling of control,” Dinham said.

However, for retirees to benefit from advice, it needed to be far more accessible.

He explained: “There are several hurdles on the supply side of the financial advice market as well as the demand side. Understandably, the main reasons pre-retirees are not currently seeking financial advice relate to a lack of affordability”.

Respondents stated they couldn’t justify the cost of hiring an adviser or couldn’t afford the services, and that they would rather do it themselves.

“It appears that advice is being priced out of reach of the people that could benefit most.”

 

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